Saturday, April 28, 2012

China faces demographic winter, without western experience with immigration

The Economist, April 21 2012, p. 53, has an important perspective on demography and China, “China’s Achilles Heel”, link here. The subtitle is “A comparison with America reveals a deep flaw in China’s model for growth”.  Essentially, of course, that’s demography and population aging (or “demographic winter”), partly as a result of the one-child policy. China has recently allowed families where both spouses were only children to have more than one child.  It’s surprising that it is still asleep on this.

China will grow old before it’s rich, the article says.   It also mentions the “4-2-1” rule, where, based on notions of filial piety rooted in Confucian ethics (maybe not the legal system), an only child is likely to wind up responsible for two parents and four grandparents, although, the magazine says, retirement homes are starting to boom in China and seem much cheaper than in the US (most of the time).

China has run the well dry on low-wage labor and now runs short on manual labor.  And, unlike the US, it doesn’t have a history of immigration to help boost its labor supply in those “learn to work” areas. 

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